Merchants typically accept various forms of payments from consumers in the course of engaging in the sale of goods and/or services. Some of these transactions include payments by cash, by check, debit card, credit card and the like.
Many of these forms of payments are electronic in nature (e.g., credit card, debit card, electronic check payments, stored value cards, loyalty points redemptions, electronic benefits transfers) and afford certain conveniences to consumers. For example, when electronic payments are accepted, consumers do not have to determine whether they have a sufficient amount of cash on their person, they often do not have to transfer funds to the merchant immediately, and at times, can purchase goods or services utilizing a line of credit.
Such electronic payment offerings also benefits merchants. For example, by offering an array of payment options to consumers, merchants typically recognize an increase in sales.
Nevertheless, present electronic payment systems have various drawbacks. For example, electronic payment systems that are located at a merchant site can have limitations with respect to the type of terminals that can interact with such system. Typically, a merchant site has one or more central computers or servers that support electronic payment terminals that are used at the merchant. Only those terminals that are configured to interact with the merchant computer or server can be used. One solution is to have multiple servers or computers, but such a system can be expensive and cumbersome.
Another solution is continuously modify the server or computer as new terminals are desired to be used at the merchant site. Such a solution, however, can require significant maintenance of the merchant's computer software and hardware.
In addition, electronic payment systems typically communicated via a dial-up modem. Such a system is inconvenient to consumers and merchants as transactions can take a long time to be completed, causing delay to the consumer and merchant. In addition, such systems do not support certain encryption techniques which provides increased security to the data transmitted over the electronic payment system. Moreover, using a dial-up modem requires that a plurality of telephone lines be used if a merchant desires to support transactions using numerous electronic payment terminals.
Also, many electronic terminals are configured such that transaction data relating to the settlement process is stored by such terminals and only sent to the merchant server as a batch. Such an arrangement results in delay when the settlement process is effectuated.